HEGARTY v. LUFF

The plaintiff, Eugene D. Hegarty, has brought suit against three defendants for the payment of an arbitrator's fee. The three defendants are Morris Luff of Washington, D.C., Willard J. Luff, who resides in Maryland and who is employed in Pennsylvania, and John W. Slacks of Arizona. The defendant, Morris Luff, was served personally within this jurisdiction.

Upon motion of the plaintiff, summary judgment was entered by the Court in favor of the plaintiff against the defendant Morris Luff in the amount of $ 6,378, said sum to be paid to the plaintiff from a fund of $ 20,000 that had been deposited in the Registry of the Court. This fund was created pursuant to an order of Court on January 30, 1958 in Civil Action 557-55.

The plaintiff also petitioned the Court for an order directing the two remaining defendants to appear, plead or answer, in accordance with § 1655, Title 28 United States Code.

' § 1655. Lien enforcement; absent defendants

'In an action in a district court to enforce any lien upon or claim to, or to remove any incumbrance or lien or cloud upon the title to, real or personal property within the district, where any defendant cannot be served within the State, or does not voluntarily appear, the court may order the absent defendant to appear or plead by a day certain.

'Such order shall be served on the absent defendant personally if practicable, wherever found, and also upon the person or persons in possession or charge of such property, if any. Where personal service is not practicable, the order shall be published as the court may direct, not less than once a week for six consecutive weeks.

'If an absent defendant does not appear or plead within the time allowed, the court may proceed as if the absent defendant had been served with process within the State, but any adjudication shall, as regards the absent defendant without appearance, affect only the property which is the subject of the action. When a part of the property is within another district, but within the same state, such action may be brought in either district.

'Any defendant not so personally notified may, at any time within one year after final judgment, enter his appearance, and thereupon the court shall set aside the judgment and permit such defendant to plead on payment of such costs as the court deems just. June 25, 1948, c. 646, 62 Stat. 944.'

This petition was granted, and personal service was made upon the defendant Willard J. Luff in Pennsylvania and upon the defendant John W. Slacks in Arizona. These non-resident defendants now ask this Court to vacate the order entered under § 1655, Title 28 U.S.C. and to quash the service of process. The plaintiff has filed opposition to said motion. A hearing was afforded the parties, at which time arguments were presented.

The main grounds relied upon by these defendants in support of their motion are that this is not a proceeding to enforce a lien upon, or claim to, or to remove any incumbrance or lien or cloud upon the title to real or personal property within the district within the meaning of the pertinent statute and that the plaintiff's cause of action is 'in personam' and, therefore, personal service within this jurisdiction must be obtained upon these non-resident defendants to bring them within this Court's jurisdiction.

The determination of two questions will lead to an answer in the present controversy. First, is the action presently pending 'in personam'? Second, does the plaintiff have a 'lien' or 'claim' within the meaning of the statute?

The plaintiff is seeking to collect a fee for services that he rendered as an arbitrator, pursuant to a written agreement between him and the three defendants. There seems to be no dispute that these services were rendered, although no fee was set by this contract as payment to the arbitrator. Thus, the plaintiff may be classed as a contract creditor.

This leads to a determination or resolving of the first question presented, for in order for the plaintiff to accomplish service under the provisions of Title 28 U.S.C. § 1655, the proceedings cannot be 'in personam.' While not every action in rem is within the descriptive terms of the statute * * * it has been generally held that the statute contemplates only actions which under traditional concepts may be classed as actions in rem or quasi in rem, and not one which under these concepts is labeled an action in personam where jurisdiction of ...

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